This picture tells it all! I was outside barbequeing and I noticed the house, kitty corner from ours, going up for sale. There wasn't any REALTOR'S name on the sign, only their company's name was. The street looked like there was a graduation party, an Estate Sale, or other activity. It was acturally potential buyers waiting their turn at having a showing. Every 15 minutes people would go in, leave, another potential buyer would get out of their car and go in. This went on for hours and final stopped around 5 pm.
It recieved an offer of $20,000.00 over list!!! Only 3 days on the market. WOW! This is the new normal. I don't know what the terms were. In other words cash, cash to new new mortgage or? An agent in our office that was scheduleing a showiing, and every 15 minute increments were booked. There were about 30 people or more that did not get the house I spoke of. I'm sure there were many offers. But this tells you that we needed another 40 to 60 homes for these buyers in their price range. It's true for higher priced homes as well.
What can you do? First, have your financial house in order. You need to get pre-approved and have a mortgage letter from your lender that states what you qualify for. These pre-approvals usually have a life span of 90 days, so make sure it's current. If your'e going to pay cash, you will need proof of funds. I have called banks and asked them if they could send me a letter as to what they could afford or have documents with the amount of funds availbale to you. If your a new buyer, this process will be extremel frustrating. If your thinking of selling your home, it is a great time if you have somewhere to go, like a second home. Otherwise you end up in the above scenario.
Why didn't we get the house we put a purchase agreement on? It could be something like a poker hand, four of a kind best a full house. Cash will trump a same price offer just about everytime over a pre-approved buyer. They close fast and the seller doesn't have to wait for an appraisal and sometimes no inspection as well. Definately go with a home inspection if you don't feel comfortable without one. Again, a seller might find not having a home ispection where the house is sold " as is " to be attractive. In speaking with a title company that we often use, they state that mortage companies have hundreds of pre-approved mortages that aren't being use because the buyers have become frustrated with this crazy seller's market.
As an ABR ( Accredited Buyer's Representative ) I can come up with some, " out of the box " ideas that will work some of the time. It's tough out there and you need someone that can guide you throught these extremely rough times for buyers.
If you have any questions or thoughts about this aritcle, please contact me. Richard Alliston, email: richard@thechessplayingrealtor.com Phone or text 248-912-2983/